People who live in a neighborhood with covenants and a homeowners' association (HOA) usually have to pay HOA fees and, at times, special assessments. If you don't pay the HOA fees or assessments, most HOAs have the right to try to collect from you in various ways, such as by placing a lien on your home. In many cases, the lien attaches to the property automatically. Then, if you don't bring the dues current, the HOA most likely has the right to foreclose your home.
People often use the terms "HOA assessment" and "HOA dues" interchangeably, but technically they're different. HOA dues (or "fees") are recurring payments that usually happen monthly, quarterly, or annually. These charges cover the day-to-day costs of the HOA and pay for such things as landscaping, maintenance, and amenities.
HOA assessments, on the other hand, pay for unanticipated items or expenses not covered by the dues or the HOA's reserve fund. For example, an HOA might levy a special assessment to pay for a new private road, plumbing overhauls, roof repairs to a common facility, renovating a community clubhouse, or adding pickleball courts or a swimming pool to the community.
Again, there's a difference between HOA dues and assessments.
Generally, each unit or household in an HOA must pay a monthly, quarterly, or yearly HOA fee based on the board's budget. This fee is often called "dues." The monthly, quarterly, or yearly HOA fee consists of two parts:
So long as the HOA board accurately predicts which repairs will come due (and when), the dues should cover the current operating expenses and long-term maintenance.
Sometimes, HOA fees and reserves aren't sufficient to cover all of the HOA's expenses. So, when necessary, the HOA may impose a one-time special assessment. An HOA typically levies a special assessment when:
In these instances and others, the HOA can usually charge homeowners a special assessment.
Some HOA special assessments require a homeowner vote. Whether or not a homeowner vote is required depends on the HOA's governing documents, such as the bylaws and Declaration of Covenants, Conditions & Restrictions (CC&Rs) and, perhaps, state laws. In California, for example, an HOA can charge an assessment that's more than 5% of the fiscal year's gross budgeted expenses without the approval of a majority of HOA members. (Ca. Civ. Code § 5605(b) (2025).)
The purpose of HOA dues and HOA assessments is the same: They pay for neighborhood expenses.
Here's chart explaining the difference between HOA dues and assessments.
Characteristic of the HOA Charge |
HOA Dues (Fees) |
HOA Assessment (Special Assessment) |
Frequency |
Recurring, regular, and predictable (monthly/quarterly/annual) |
When necessary, one-time fee, occasional |
Purpose |
Routine operations, maintenance |
Unexpected, unbudgeted, or emergency expenses |
Approval |
Planned for and set in the annual budget |
Board approval needed, might require homeowner vote |
Examples |
Landscaping, pool maintenance |
Storm damage repairs, uninsured losses |
An HOA has a board of directors. Each year, the board develops a budget for the community and decides how much to charge each unit or household as a monthly (or, in some cases, yearly or quarterly) HOA fee. The board typically takes the total amount needed and divides it by the number of homes in the community, splitting the cost equally.
But the board's predictions aren't always accurate. Occasionally, the HOA might need to come up with more funds. In that case, the board usually has the authority to impose a special assessment to cover the one-time expense of a major repair or improvement. Again, the cost is usually split equally. For example, if the HOA expects to need $100,000 to repair a damaged clubhouse and there are 100 homes in the HOA, each must pay $1,000 as a special assessment.
Generally, HOA fees and assessments aren't tax deductible. If you live in a home that's part of an HOA as a primary residence, those costs are considered personal expenses. Under some circumstances, however, you might be able to add an amount for a special assessment to your cost basis when you sell the property.
However, if you own a rental property and pay HOA dues or assessments for that rental property, you might be able deduct them as an expense, depending on the situation. Also, if you exclusively use part of your home as a home office for business purposes, you can probably deduct a portion of your HOA dues or assessments proportional to the area you use for business.
Whether you can deduct an expense is complicated. Whether you can deduct money you pay to an HOA varies depending on the situation. And repairs and improvements are treated differently under the tax code. Talk to a tax adviser if you need tax help or have questions about what you may deduct.
If you don't pay your HOA, it has various way to try to collect from you. For example, the HOA might take away your ability to use common facilities, such as a pool or gym, or it might file a lawsuit against you.
In addition, most HOAs can place a lien on the homeowner's property when dues or special assessments go unpaid. Once the HOA has a lien on a homeowner's property, it may foreclose as permitted by the CC&Rs and state law.
Finding out about an HOA special assessment can be frustrating. After all, this is an extra expense you weren't expecting. However, if your HOA says you must pay a special assessment, you'll probably have to pay it even if you think it's unfair. When you bought a home in an HOA community, you agreed to comply with the governing documents, including the association's bylaws and CC&Rs. So, if the governing documents, typically the CC&Rs (and state law), allow the charge, you're on the hook for it.
If you think an assessment isn't allowable, you could potentially challenge the assessment with the board or by filing a lawsuit in court. However, if a court finds the assessment reasonable and allowed, you might have to pay even more because you could be responsible for paying the HOA's legal costs.
Fortunately, special assessments are relatively rare. Often, the HOA's dues and reserves will cover unexpected costs that arise. And most HOA governing documents require the HOA to give adequate notice before requiring you to pay a special assessment.
Not paying your HOA assessments can hinder your ability to sell your home. Again, if you don't pay the HOA, it can get a lien on your home. That lien acts as a "cloud" on title. You'll probably have to pay off the lien to sell the home. You might have to pay the HOA at closing in order for the deal to go through.
An HOA lien might affect your mortgage. In some states, HOA liens get super-priority status, which means that if the HOA forecloses, the mortgage gets wiped out. So, most mortgage lenders in super-lien states will pay the HOA if you don't. Then, the lender will seek reimbursement from you. If you don't pay the lender, it will probably foreclose.
If you're facing a foreclosure due to unpaid HOA assessments, consider talking to a foreclosure attorney in your state to discuss all legal options available in your particular circumstances. You might be able to work out a payment plan with the HOA or you might have a defense to the foreclosure.